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On Thursday, April 9, the Montana Department of Environmental Quality approved the Black Butte Copper Project, a controversial mine on Sheep Creek, a tributary of the Smith River about 15 miles north of White Sulphur Springs.
Calling the hard rock mining permit “the most protective” DEQ has ever signed, DEQ Director Shaun McGrath said the approval doesn’t mean mining will start tomorrow. Within 40 days, DEQ will determine the bonding for the 1,888-acre copper mine, which is expected to operate for 19 years and provide up to 250 jobs.
“We’re extremely glad to have reached this milestone. It’s a big deal for our company. Until this happened, everything beyond it was still a fantasy,” said Jerry Zieg, senior vice president of Sandfire Resources America, a Canadian firm that is mostly owned by Australian mining company Sandfire Resources.
McGrath said the permit contains such stringent environmental protections because mine operator Tintina Montana, Inc., which is owned by Sandfire Resources America, worked with DEQ to go above and beyond its legal requirements to protect the area.
“The standards set by this project are new to the mining industry in Montana, and pretty much to the world at large,” Zieg said. “We’re taking measures to protect water well beyond what’s required. We’re raising the bar a bit, but we felt like in this location, that was necessary.”
But conservationists concerned about the effects the mine could have on the Smith River, a blue-ribbon trout fishery and popular floating destination, say the decision doesn’t go far enough.
“Sometimes the best deal isn’t good enough,” said Scott Bosse, Northern Rockies director for American Rivers, a nonprofit organization that works to protect river health.
LITIGATION COULD DELAY PROJECT
At the very earliest, the mine would be operational in two-and-a-half years, Zieg said. First, the mine needs to secure financing, which it is “very well connected” to do, he said. Sandfire is finalizing a feasibility study, but Sandfire Resources is very interested in seeing the project through, he said.
Construction of the mine, including a 5,000-foot tunnel, will likely take two-and-a-half years. But Zieg acknowledged the possibility that the project could be delayed, either by lawsuits or the COVID-19 pandemic and associated economic impacts.
Already, American Rivers and the Montana Environmental Information Center both said they are reviewing legal options and are considering litigation against DEQ for the permit’s approval. The project received more than 12,000 public comments, 95% of which were opposed to the mine.
“We are going to consider litigation,” said Derf Johnson, clean water program director for MEIC.” We think, just on the face of it, our preliminary analysis shows DEQ made a very poor and legally vulnerable decision in permitting the mine.”
“They don’t have any actual on-the-ground examples of it working. I have serious concerns about the Smith River being the guinea pig for this type of project.”—Derf Johnson, clean water program director for MEIC
Among MEIC’s concerns are the geochemistry of the site and the project’s likelihood to create acid mine drainage, Johnson said. The ore body is also very reactive, and it’s possible that tailings storage facilities and other protective measures could deteriorate over time, he said.
“This is the wrong mine, with the wrong drainage and wrong ore body. There’s just too much at stake for putting a mine in such a highly reactive ore body into such a cherished watershed,” Johnson said.
While Zieg touts the protections as raising the bar for environmental responsibility, Johnson said many of them are novel and unproven.
“They don’t have any actual on-the-ground examples of it working,” Johnson said. “I have serious concerns about the Smith River being the guinea pig for this type of project.”
Additionally, Tintina executives have touted the prospect of creating a 50-year mining district tapping copper deposits along the river corridor, and owns more than 525 mining claims on neighboring public and private lands, which DEQ should have considered, Johnson said.
McGrath said the agency is unable to consider aspects beyond the specific permit application, but Johnson said MEIC disagrees.
Zieg said the company would like to expand the project’s longevity, and has a nearby copper deposit that is smaller than the Johnny Lee deposit at Black Butte. Zieg, a geologist and White Sulphur Springs native, said he continues to search for additional deposits. If the mine were to expand, Tintina would have to go through an additional permitting process, Zieg said.
“We would like to keep that economic prosperity going as long as possible and give the community time to develop other avenues, so when the mine does eventually shut down, the town has a much more solid economic base,” Zieg said.
RISKS GOING FORWARD
In Management Discussion and Analysis documents filed with SEDAR, the Canadian equivalent of the U.S. Securities and Exchange Commission, Sandfire has said that risk factors include failure to secure financing, a decline in the price of copper, less copper in the deposits than estimated, and hazards such as fire, floods, unexpected geological conditions and cave-ins.
“As is generally the case in the mining industry, these and other hazards may cause, among other things, injuries or death to employees, contractors or other persons at the Company’s mineral properties, destruction of the Company’s property, plant and equipment and mineral properties, and other adverse consequences, and may result in the suspension of the Company’s exploration and development activities and any future production activities,” the document, dated Dec. 31, 2019, says. “Safety measures implemented by the Company may not be successful in preventing or mitigating future accidents.”
Higher than typical water-quality requirements, including limits on when water can be discharged and a reverse double osmosis system for treating discharged water, are among the measures required by DEQ. The mine is also required to actively monitor water quality to ensure standards are being met and aquatic life isn’t harmed.
Zieg said the company has worked with DEQ for four and a half years and is happy with the requirements.
Katie Boedecker, general manager of Showdown Ski Area and chairwoman of the Meagher County Stewardship Council, said the group is happy that DEQ and Sandfire have agreed to “commit to getting this right for the environment, our community and state.”
“It’s their goal to become a world-class, leading example of how mining and a healthy environment can coexist well together, and ultimately they plan to leave Meagher County and the Smith River better than they found it,” she said.
Boedecker, who said she is not a proponent of the project, said she remains concerned and intends to hold Sandfire to the “big promises they made.”
“My biggest concern remains that we can’t plan for what we don’t know. I believe the Smith River is too valuable long term to this county and the state, and this risk is too great,” she said.